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Fred’s Focus: A Fourth Decade of Decline

It was in the 1980s that public and private institutions began separate but complementary assaults on the American social contract. Spurred by a memo from future Supreme Court Justice Lewis Powell, American businesses displayed a new level of broad cooperation, united by the common goal of gaining maximum political power. It was to use this increased power for its own profit at whatever cost to its workers. All means justified a profitable end.

On the political level, President Reagan removed regulations on business and Wall Street, dealt body blows to labor unions, and his right hook was shifting the tax burden from the rich and corporations to the middle class via what Kevin Phillips was to call “fees.”

Reflecting on the new battleground in 1991, Governor Bill Clinton, contemplating a run for president, said “if you let 10 or 20 years go on where the middle class keeps losing ground, this won’t be the America any of us grew up in.”

Tragically, America has let the decline go on…and on.

In comparison with other industrial nations, America ranks near the bottom in areas such as health and education. We rank near the top in level of inequality. We have the second highest level of childhood poverty of any of the 34 nations in the OECD, with 22% of our children in poverty.

And America’s vaunted mobility? That is also disappearing as our political system places more and more obstacles in the path of those striving to make it up the ladder. Our starting wages are at a poverty level and despite soaring corporate profits and executive salaries, middle class wages have been indefensibly flat for decades.

But America is a nation of miracles. Every four years we elect a president. We can make a new start.

At this point, Secretary Clinton seems likely to be elected our next president. How will her policies address the problems of the American economy?

Robert Reich was Secretary of Labor in President Clinton’s administration. They had been allies since they were Rhodes Scholars together decades before.

Reich, however, declined to endorse Secretary Clinton in this election- opting instead to support Senator Bernie Sanders. “Her instinct is to be incrementalist, ” Reich wrote of Secretary Clinton, “she needs one or two big ideas that are proportionate to the scope of the problems we are facing.”

Reich’s concerns were echoed by New York Times economics columnist Eduardo Porter who asked in a recent column if Secretary Clinton’s economic plans were, indeed, too cautious. Porter notes signs that she is “indulging in nostalgia”- economic nostalgia from her husband’s presidency.

His conclusion? “Mrs. Clinton’s careful collection of tweaks and prods is no match for the challenge.” He further cited challenges: “she is proposing $275 billion in federal infrastructure investment over five years. This is less that 10% of what the American Society of Civil Engineers estimates will be needed.”

He also notes that Clinton’s tax plan would raise only $1.1 trillion over the next decade, not nearly enough to tackle our complex problems.

Porter is joined in his criticisms of Secretary Clinton’s cautious approach by Columbia University Professor Jeffrey Sachs, a former Sanders adviser, who says the Vermont Senator easily wins the debate on economic policy. He also criticized her infrastructure program as modest and reports that “Sanders calls for a much bolder public investment program aimed at the skills of young people (through free college tuition) and at modernizing and upgrading America’s infrastructure with a focus on renewable energy, high-speed rail, safe drinking water and urban public transport. Sanders’ growth strategy would get back to fundamentals: a long overdue increase in productive investments to underpin good jobs and rising worker productivity.”

In an essay Robert Reich wrote this month, he proposes a new and intriguing view of a big idea.

“The big idea I’m talking about is democracy,” Reich writes. Reich says that as president, Secretary Clinton should go after the factors that are turning America into an oligarchy.

These include:

The revolving door between the White House, the US Treasury and Wall Street;

The control of politics and therefore public policy by big, often secret, money; and

The nomination of Supreme Court Justices who would strike down Citizens United.

Secretary Clinton could go down in American history as the first woman president. Could she also go down as a great and creative president who began the process of restoring the American dream?

Patriotic Millionaire Fred Rotondaro has had a varied career that includes journalism, teaching, anti-poverty and civil rights work, and national association management. He was a senior fellow from 2003 to 2015 at the Center for American Progress where he concentrated on poverty and inequality. He has written extensively for academic and popular publications. He holds a PhD in American Studies from New York University, an honorary doctorate from Wheeling College, and is currently Chair of the Board of Catholics in Alliance for the Common Good.

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Proud “traitors to their class,” members of the Patriotic Millionaires are high-net worth Americans, business leaders, and investors who are united in their concern about the destabilizing concentration of wealth and power in America. The mission of The Patriotic Millionaires organization is to build a more stable, prosperous, and inclusive nation by promoting public policies based on the “first principles” of equal political representation, a guaranteed living wage for all working citizens, and a fair tax system:
1. All citizens should enjoy political power equal to that enjoyed by millionaires;
2. All citizens who work full time should be able to afford their basic needs;
3. Tax receipts from millionaires, billionaires and corporations should comprise a greater proportion of federal tax receipts.

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The Patriotic Millionaires is a group of high-net worth Americans who are committed to building a more prosperous, stable, and inclusive nation. The group focuses on promoting public policy solutions that encourage political equality; guarantee a sustaining wage for working Americans; and ensure that millionaires, billionaires, and corporations pay a greater percentage of taxes.